Saddam’s war with Iran, at the behest and encouragement of the West, was painted as ‘human-rights’ violations. Death of soldiers in any war, cannot be equated to civilian casualties. Soldiers are going to war, armed to the teeth, with eyes wide open, knowing fully well, that it is a case of kill or get killed.

The alphabet soup behind this

Bush, CIA, FBI did not have to convince anyone. Frenzied activity by people to convince each other of the need for war, killing, death and destruction did the job.

Wonder who created these viral and circular links, (now dead, but live at some time) on the web, without any source or existence. Which of the American agencies – CIA FBI, NSA, DEA, DOE, Bureau of ATF, DIA, NRO, NIMA, CTC. NPC. INR. DOE Intel., Army Intelligence et al?

But let us assume that vox americanum populi, vox dei (Voice of the American people is the voice of god), and accept the figure of less than 600,000 deaths under Saddam Hussein.

Ten years later

After the bombing of twin towers, on September 11, 2001, there has been much official sentiment and sanctity.

Real people

A figure of one million Iraqi and Afghan civilian casualties has been arrived at by this estimation method. An estimation method commonly used and usually accepted.

Documented and cross verified reports by the Iraq Body Count, count more than a 100,000 civilian deaths in Iraq. To all those believe that only the Body Count report is good enough, I wonder why they don’t use the same standard for figures about deaths due to Saddam’s atrocities.

Whatever number one may chose, it is important to use the same standard. Saddam, it seems was a lesser evil.

Does it matter

Of the nearly 1 million undocumented and estimated Iraqis dead or the documented 100,000 Iraqis dead, the number does not matter. Both the numbers, are huge numbers.

Not that this is the first time. After killing 20 lakh Vietnamese, the American Empire (and its respectable mouth-piece, Time magazine) only counts its own 60,000 killed. In Iraq, after 10 lakh dead Iraqis, the US Empire counts, its’ own less than 5,000 dead.

Imperial Traits

The British Empire till well after its death, continued (s) to remain self-absorbed. As though other people did not exist, do not matter. Twentieth century, British writing about India, had deteriorated to pure drivel. Best epitomised by Chirol – Sir Ignatius Valentine Chirol (28 May 1852 – 22 October 1929).

In case of Pax America, in an earlier Cold-War era, this self-absorption was marked by books like The Ugly American – which sold 5 million copies, in a nation of some fifty million households. Since, the writing of The Ugly American, the self-absorption has only deepened.

This self-absorption screams through these three images linked to this post.

Image no.1 – About my money. It was Iraqi oil and Iraqi money, by the way. A message to David Leonhardt, the Washington Bureau Chief of nytimes.com, evoked no response.

Image no.2 – Talks about my social position. If every month, hundreds of people, are blowing themselves up, there has gotta be a bigger problem, than your social position. Stop looking at Muslims. Look at yourself.

Image no.3 – About my trophies.

Do more words and more bombs, make the War on Islam, OK?

What to do

Possibly, all this killing and war is my problem, in my mind. Who is to blame, if I was brought up, believing,

ईशावास्यमिदं सर्वं यत्किञ्च जगत्यां जगत्।

तेन त्यक्तेन भुञ्जीथा: मा गृध: कस्यस्विद्धनम्।।

(God resides in all; All this here, is permeated by Brahman [The Supreme Soul], whatever there is in this world. Enjoy things by renunciation. Do not covet others’ wealth. – Ishopanishad; Shloka 1; note alternate translation comment below.).

For Europe, the grand prix is to replace the dollar as the currency of international trade – especially oil trade. Euro as a international trade-currency-of-choice, will give the Euro region access to more than 1 trillion euros in zero-cost floating balances.

China is expecting the yuan to play a similar role. Such are plans made by mice and men.

Sales of gold coins are on track for the best month in a year amid the worst commodities rout since 2008, a sign that bullion’s longest bull market in nine decades has further to run, if history is a guide.

The U.S. Mint sold 85,000 ounces of American Eagle coins since May 1 as the Standard & Poor’s GSCI Index of 24 raw materials fell 9.9 percent. The last time sales reached that level, bullion rose 21 percent in the next year. Gold will advance 17 percent to a record $1,750 an ounce by Dec. 31 and keep gaining in 2012, the median estimate in a Bloomberg survey of 31 analysts, traders and investors shows.

You take free advice …?

Back in late January, as the world’s important people rubbed elbows in Davos, billionaire investor George Soros had some rather definitive thoughts to offer on gold, which he called “the ultimate asset bubble,” according to reports.

In this game of musical chairs, when the music stops, everyone who does not own gold is out. (Cartoon by David Horsey; Courtesy - http://politicalhumor.about.com). Click for larger image.

The new filings from funds “may show that big names exited ETPs and this news may cause prices to slip in the very short term,” said Bayram Dincer, an analyst at LGT Capital Management in Pfaeffikon, Switzerland. Some funds switched to holding gold directly so they wouldn’t have to announce it publicly, he said.

Is gold a bubble?

Gold is in a bubble. Anyone will tell you that. They’ve been saying it since gold was about, oh, $500 an ounce. But it’s a funny kind of a bubble. It’s the only one I’ve encountered where so few people seem to own the asset in question.

During the dot-com bubble, you met lots of people with tech stocks. Taxi drivers told you what dot-coms they owned. During the housing bubble you met normal, ordinary people who were trading up to expensive homes using adjustable-rate mortgages, buying new condos off plan to flip, and cashing out their fictional “equity” through a refinance mortgage.

But who actually owns gold? I keep hearing about the gold bubble, but every time I ask people if they own any themselves, they say, “no, no, of course not, it’s a bubble.”

Some bubble.

Central banks around the world are printing more dollars, euros, pounds and yen. Gold may simply be a less awful currency than all the others. Banks can’t print any more of it, so its price should probably rise while other currencies fall.

For this year, the question in India seems to be, “Will gold cross Rs.25000, by 2011 Diwali?”

Is Pax Americana like Britain was a hundred years ago? (Cartoon courtesy - mpg50.com.). Click for larger image.

Fat and lazy

Between 1875-1935, Britain was dependent on India for gunpowder, on USA and Iran for oil, on Malaya and India for rubber. British economy had grown fat and uncompetitive – unlike Italian, German and Japanese economies.

Even though Britain won WWII, their economy was a lost cause. Though Germany, Italy and Japan were losers, with their economy in shambles, they could make a brilliant recovery and vastly out-compete Britain.

The story of Middle East oil is similar for USA and West. The Welfare State, built on a diet of cheap oil, easy dollars, is now too expensive for the West to sustain. The above book extract gives an excellent snapshot of the oil industry in the 20th century.

India and Honest Brokers

Two cats go to a monkey for help in dividing some eatable equally. End result – the monkey gets everything. The cats, nothing. ‘Honest’ brokers are the monkey which leaves nothing for the cats.

Hillary Clinton assured a nervous gathering of Foreign Policy analysts that the world is counting on the USA today as it has in the past. When old adversaries need an honest broker or fundamental freedoms need a champion, people turn to us. When the earth shakes or rivers overflow their banks, when pandemics rage or simmering tensions burst into violence, the world looks to us. (via Remarks on United States Foreign Policy).

In real life

What is left of Pakistan after US finished with brokering Pakistan’s future? After the West carved up the Ottoman Empire, and divided the Turkish possessions among their puppets, what is left of the Middle East? With oil, Big Oil, oil politics, oil-dollar, oil prices at stake, can the US be a honest broker.

Tell that to the birds.

With oil at stake, how 'honest' a broker can the US be? (Cartoon by Pat Oliphant). Click for larger image.

Can there be a ‘honest’ broker?

This idea that there cannot be ‘honest’ brokers, made Buddhism so popular all over the world. Not pretty statues and musical chants. In the last 200 years, भारत-तंत्र Bharat-tantra has gone into regression. But, in this period, the world has also learnt more about the limitations of the Desert Bloc ideology.

Why compare Japan with Lat-Am and Zimbabwe? Why not with USA, China and Germany which is more like in Japanese class! (Cartoonist - Clay Bennett, from Clay Bennett's Editorial Cartoons; courtesy - cartoonistgroup.com.). Click for larger image.

An Indian problem

In spite of being less than anybody, British media can be pretty biased.

One example was a post by Ian Campbell on Japan’s economic problems. He says,

Japan has … has the worst debt to GDP ratio among major economies … But the interest yield on Japanese government bonds is … not much more than 1 per cent, so the debt is not yet so problematic – and might not seem an obstacle to still more spending. … In just five years, even assuming the economy grows, debt might climb to 230 per cent of GDP … the hideously large debt would finally drive the fiscal deficit far higher and become intolerable.

Japan’s only route then would be drastic fiscal reform or, more probably, huge resort to the printing press, as Latin America did in the old days and Zimbabwe in more recent times. (via Nokia’s billion-dollar man).

Sad Brits …

Campbell, a British journalist, compares Japan with Latin American and African Governments who have printed a lot of money.

But surely he knows that Western Governments – under the leadership of Ben Bernanke printed much more than Africa and Lat-Am could and did! Why is Campbell not talking of British, European and American printing presses?

Is there a racial smell and smear somewhere? Did I hear him say ‘These irresponsible Blacks, Latinas, Browns, Yellows …’

Japan’s problems

Now Japan’s problems are minor – because they have solid, well run, high tech companies, whose products are in demand all over the world.

Off their peaks, these Japanese firms still have mean clout in business world. Japanese interest rates being so low will not change Governmental economics by much. So, why compare Japan with Latin America or Zimbabwe?

Wishful thinking?

Is it wishful thinking Mr.Campbell? Balanced your judgment is not. Or is it just plain malarkey? Methinks, it is ‘White’ noise!

Ian Campbell, who has“recently returned to the UK, where he is writing a book on rural Mexico.” could utilize his time much better writing about rural Britain, which depends on huge subsidies from a nation groaning under 500% Gross-National-Debt (GND-that is Govt.+Corporate+household).

Now British GND (no hindi puns intended) is a much-more-hideous. Than Japanese at 500%. We both know that British exports are going nowhere!

Cartoon Text - "Austerity? But late squire ... she has been dead these fifty years." 2ndlook says - Is it not time to focus on Britain itself? Japan will do very well, without British attention. (Cartoonist Jeff Danziger; courtesy - cartoonistgroup.com.).

Let us look at British economy

First the biggest sector of British corporate sector is about digging, extracting and selling natural resources.

A historical legacy – with little value-addition. Royal Dutch Shell, BP, North Sea Oil, XStrata, Anglo American, Rio Tinto Group, BHP Billiton, BG Group, National Grid, Scottish and Southern Energy, Centrica. That is 10 of the top 30 British companies. These companies mostly have their assets abroad – and if push comes to shove, you know these companies will go where their bread is buttered.

The second leg on which British industry stands today is cracked leg of banking and insurance – HSBC, HBOS, RBS, Lloyd’s TSB, Barclays, Standard Chartered, Aviva and Prudential. The British part of the business of these 8 financial firms is in mess. The international business is subsidizing the British business. How long do you think this will last?

The third wobbly leg is pharmaceuticals made up of two companies. Glaxo-Smithkline-and Astra Zeneca. Both are in doldrums due to competition from generic Indian companies – and may look good to beery British journalists boozed in a pub. Now these are the three legs of British economy. We know that three legged stools are always prone to topple over.

That was lesson No.1 for you Campbell.

Is this how British journalism lifts its spirits? (By Paresh Nath, The Khaleej Times, UAE - 5/19/2010 12.00.00 AM)

Blind spots

In the last few years, the Chinese economy and administration has changed – unannounced and in a very subtle way. There is an interesting openness and candour, which are new elements in the China-mix.

Instead of the usual three themes of real-estate bubble theory, the mega infrastructure projects and the impending dollar-yuan revaluation, this post will look at four other elements. These four elements are usually ignored in most China analysis – which this post will address.

The US recruited Europe, Japan, Asian Tigers - and now China in this manner for the last 60 years.

China opens up

In March 2010, China appointed three economic advisors to ‘help’ the People’s Bank Of China. Drawn from academic backgrounds, the names of the advisors were leaked to the press.

Zhou Qiren, Xia Bin and Li Daokui will replace Fan Gang, formerly the sole academic member of the committee, the People’s Bank of China said in a statement on its Web site today, citing decisions by the State Council, the top cabinet. Zhou and Li have spent much of their careers in teaching and academic study, while Xia has worked as a researcher at government agencies.

Li Daokui has been a forthright and hawkish tone in flagging China’s problems! What gives. The way it seems, these economists are talking down the yuan! An orderly devaluation of the yuan and a negotiated recapitalization awaits Chinese banks.

“The housing market problem in China is actually much, much more fundamental, much bigger than the housing market problem in the US and UK before your financial crisis,” he said in an interview. “It is more than [just] a bubble problem.”He was speaking ahead of Monday’s announcement by the State Council that it had approved a plan to reform real estate taxes, the clearest indication yet that the government will for the first time impose an annual tax on some residential housing in order to rein in rising prices. The news sent shares in China down 2.4 percent. (via China Property Risk Is Worse Than in US – CNBC).

Euro-slide Effect

EU is the largest market for Chinese exports.The change in the Euro-yuan equation in the last 6 months has made Chinese exports to the EU more expensive. This will still not take US pressure off yuan revaluation – and anyway there was no much pressure from EU for a Euro-yuan reset!

Graph courtesy - The New York Times

Chinese leaders reached a consensus in early April to break the renminbi’s peg to the dollar. That ended a dispute that had spilled into public view in March when Commerce Ministry officials warned in speeches and interviews in Beijing and Washington about the dangers of any change in the renminbi’s value. The ministry halted those warnings immediately after the consensus was reached, and Chen Deming, the commerce minister, even reversed himself publicly by saying that China’s trade deficit in March was nothing to worry about.

Trade finance out of China

A few quarters ago, China’s trade froze due to lack of trade credit. Chinese banks were unable to get intra-bank limits – and in turn were unable to fund letters of credit for Chinese exporters.

A hiccup in the Chinese realty markets could freeze wheels in China – freezing trade wheels in Asia. As reported earlier in April 2009,

China’s exports rose 7.6% in March from February, after six straight months of contraction. “While exports growth is likely to remain weak in the coming months,” Goldman Sachs economists Yu Song and Helen Qiao commented about China, “we believe the worst sequential slowdown probably is behind us now.”

Some of the revival is due to the greater availability of trade finance, which had dried up as banks clamped down on lending in late 2008, hamstringing global trade.

The Shanghai Composite

In 2010, even as global markets recovered or stabilized, the Chinese Shanghai Composite Index is in bad shape.

In the rankings of the world’s worst-performing stock markets this year, nations drowning in debt feature heavily. Greece is number one, closely followed by Slovakia, Cyprus and Spain. But then, in fifth place, there is China.

Shanghai’s decline – the index is down 16 per cent since January – has caught many investors by surprise, since China is widely seen as a beacon of growth in a world that is still reeling from the financial crisis.

Having fallen to a eight-month low on Thursday, the Shanghai Composite is this year’s worst performing index in Asia.

This may no longer be an issue!

Is the Chinese catastrophe overstated

The China Bubble theory has been pushed by people like Jim Chanos, who cut his teeth by predicting Enron and Tyco. In January this year, he made a widely reported prediction that China is “Dubai times 1000” and is likely to burst any time soon. Chanos’ Biblical imagery and descriptions about China’s, “Treadmill to Hell’ gives the game away. Marc Faber is another boom-and-doom theorist, who has predicted a China bust up! Another economic commentator, Hugh Hendry, in a similar vein, says,

“They suggest a new era reminiscent of Protestant Capitalism. They want us to believe the atheist Chinese are prepared to work harder and defer their gratification for longer.”

These commentators are seemingly painting this economic scenario with theocratic hues! A modern version of the medieval crusades?

The logic of China-busters is very well refuted by those who who are closer to China market and economy – unlike some American Sinologists, who talk to other Sinologists, whose ‘unquestioned’ expertise is based on other Sinologists’ opinion.

Siamese’ triplets

The Great Recession is like a case of conjoined triplets.

One is the USA – who has used their Bretton Woods licence to print dollars and flood the world market with excess liquidity. The US has also used their ‘dollar power’ to gain loyalty by favouring their allies, satellites and client states with low exchange rates that boost exports. Europe, Japan, Asian Tigers, (and now) China have all been favored with a ‘beneficial’ exchange rate in the past. At an ‘appropriate’ time, this ‘benefit’ was taken away. The US gained by ‘recruiting’ low-cost labour of these economies.

The US 'out-thunk' the Euro-zone on the Euro-currency strategy!

US imports, were underwritten by an increasing volume of IOUs, denominated in depreciating dollars. By paying for imports with IOU notes, the US could subsidize their high-cost exports, to these ‘semi-captive’ markets.

With dollar IOUs and dollar liquidity, US funded hi-tech R&D, overseas acquisitions (of companies, raw materials, allies), commercialize new technologies and standards (internet, software) space and defense, et al. Last forty-year estimates, show that US obtained funding equal to one full year’s US GDP. At nil cost!

All this due to the US dollar’s reserve currency status!

Can Europe be far behind

The Euro unwinds!

Post-Plaza Accord, Europe decided to get into ‘reserve-currency’ game, with the launch of the Euro currency in Jan 2002. As an incentive to TT-Note holders, the ECB ‘allowed’ the Euro to appreciate – vis-à-vis the dollar. This gave windfall gains to countries holding Euro as a reserve currency.

From dollar parity in 2002, the EU appreciated by more than 60%. After the introduction of Euro, in the first six years, Euro-bond holders hit a gusher. Anyone who held Euro bonds from January 2002 upto Decemeber 2007, would have made some 80% return during this six years. A return of 15% per annum. Close to junk bond returns.

After the ECB took the bait, the US played a waiting game. After running with the overvaluation bait, for 8 years, the Euro- fish is now tired. It is not able to break free of the over-valuation hook. The US is now reeling in the fish.

With a ‘strong’ currency, the option for Euro-zone is massive and painful deflation. Wages, pensions, prices, welfare state benefits will need to come down – and drastically. Do they have the steel or the hunger to do this. Used to a gold-plated Welfare State, Euro-zone does not have the moral resolve to go on a cold turkey diet of frugality.

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